China's economic growth slipped in the three months to the end of June after a slowdown in the global economy triggered a fall in manufacturing exports.

Beijing reported a fall in year-on-year GDP growth from 7.7% in the first quarter to 7.5% in the second.

Stock markets greeted the figures with relief after dire warnings that China's growth figures could have been worse. The FTSE index climbed 0.75% in early trading against average 0.5% gains on other European exchanges.

But concerns that China's economy will continue to slow were heightened on Monday after a spokesman for the National Statistics Bureau denied that Beijing has targeted a minimum growth rate of 7%.

The statement reinforced the growing view among economists that the new Chinese leadership will resist the temptation to spend some of the $3.5tn (£2.3tn) it holds in foreign reserves to underwrite further expansion by state-owned enterprises. Borrowing by property companies has also come under pressure from tighter restrictions on bank lending.

The fifth straight quarter of growth below 8% is "a clear sign of distress", said Xianfang Ren, an IHS Global Insight analyst. With investment weak, she said, the economy could be at risk of stalling.

Analysts at Nomura immediately responded with a prediction that growth will drop to 6.5% next year.

Zhiwei Zhang, Nomura's chief China economist, said Beijing wanted businesses to cut their borrowing, and was prepared to accept the reduction in investment likely to limit growth.

Zhang also highlighted the problems caused by the country's shrinking population and a lack of structural reforms.

"The size of the working-age population fell in 2012 for the first time in at least 20 years and will likely continue to slide in 2014 and beyond," Zhang said.

"Progress on structural reforms has been slow. The government has announced guidelines twice in the past five years to encourage private investment but concrete action has been limited. When the Central Committee of the Communist party meets in October, it is expected to lay out the reform agenda for the next five to 10 years."

He said it was unlikely that incentives to encourage private investment would fully offset the effects of deleveraging and a shrinking working population.

Wei Yao at Société Générale said an increase in the disposable income of China's urban population was crucial to maintaining growth, but at present income growth was falling.

"Retail sales value growth, in real terms, decelerated to 11.7% from 12.1% year on year in the previous month," she said. "Such a deterioration seems consistent with the deceleration in household income.

"Urban household disposable income growth slid to 8.9% in the second quarter from 9.3% year on year in the first quarter, and rural cash income growth to 11.6% from 12.2% year on year, despite largely stable inflation."

The International Monetary Fund last week cut its 2013 growth forecast for China to 7.8% from its 8.1% outlook in April. The IMF's forecast for 2014 was cut to 7.7% from 8.3%. The IMF's chief economist, Olivier Blanchard, said China was the country at the greatest risk of a large decrease in growth.